Assess whether a redlining pattern exists after controls (247d32)

Situation

A DOJ or CFPB monitor request for pricing files put appraisal-gap outcomes in majority-minority tracts in front of adverse-action notice operations lead in a lender expanding into majority-minority census tracts. This Fair Lending / Redlining and HMDA Data close is a redlining pattern exists from appraisal-gap outcomes in majority-minority tracts, and the live options are Remove access or reverse the item, Temporary compensating control, Approve a documented exception.

Decision

Adverse-action notice operations lead in a lender expanding into majority-minority census tracts must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using appraisal-gap outcomes in majority-minority tracts after a DOJ or CFPB monitor request for pricing files.

Hypotheses to test

• Appraisal-gap outcomes in majority-minority tracts reads as Remove access or reverse the item once a DOJ or CFPB monitor request for pricing files is lined up to the same Fair Lending population.
• Appraisal-gap outcomes in majority-minority tracts is closer to Temporary compensating control after a DOJ or CFPB monitor request for pricing files; Remove access or reverse the item would over-claim this Redlining and HMDA Data extract.
• Approve a documented exception is still live in appraisal-gap outcomes in majority-minority tracts for adverse-action notice operations lead in a lender expanding into majority-minority census tracts.
• Appraisal-gap outcomes in majority-minority tracts is missing the fact adverse-action notice operations lead needs after a DOJ or CFPB monitor request for pricing files; stop this Fair Lending close.

Analysis required

• Check HMDA coding and underwriting policy against a redlining pattern exists.
• Compare appraisal-gap outcomes in majority-minority tracts to similarly situated files, second-review notes, and reason codes after a DOJ or CFPB monitor request for pricing files.
• Flag any disparate-impact table adverse-action notice operations lead cannot explain from appraisal-gap outcomes in majority-minority tracts.
• For this Fair Lending Redlining and HMDA Data file, read appraisal-gap outcomes in majority-minority tracts against a DOJ or CFPB monitor request for pricing files and write the one fact that would move a redlining pattern exists for adverse-action notice operations lead.